The NewsRoom
Release: #3780
Date: May 31, 2007
MMS RIK
Program to Help Fill Strategic Petroleum Reserve
DENVER
– The Department of the Interior’s Minerals Management Service (MMS)
announced today that it had awarded contracts to five companies to
transport Royalty in Kind (RIK) crude oil that will be used to
resume filling the nation’s Strategic Petroleum Reserve (SPR) with
approximately 9.2 million barrels of oil over the terms of the
six-month contracts. Winning bidders are Chevron Products Company,
Plains Marketing, ExxonMobil Oil Corp., Shell Trading Company, and
Sempra Energy Trading.
The
transportation contracts apply to an aggregation of crude oil
royalties taken “in kind,” in the form of oil, rather than “in
value” or cash payments, from federal offshore lease operators in
the Gulf of Mexico.
The five
contracts, awarded in early May, provide for the transport of 45,430
barrels per day from platforms in the Gulf of Mexico to onshore Gulf
Coast market centers. In addition, the MMS will schedule the
transport of 6,170 barrels per day to market, bringing the total to
approximately 51,600 barrels per day that will be transferred to the
U.S. Department of Energy (DOE).
The DOE will
take custody of the oil at the onshore market centers, and exchange
that oil for crude oil of suitable quality to be delivered to SPR
sites in Texas and Louisiana. The six-month contracts call for
delivery of the oil to begin July 1, 2007.
The SPR is one
of the Nation’s primary means of assuring stability and security of
America’s existing energy supply in the event of an unforeseen
production or import disruption. Between 2002 and 2005, MMS and DOE
worked cooperatively on a Presidential Directive to fill the SPR.
During the fill initiative, MMS transferred over 112 million barrels
of RIK oil at a value of $4.4 billion to the SPR. The current SPR
Fill Initiative will add approximately 27 million barrels of crude
to the SPR during the next 18 months.
Media Contact:
Patrick
Etchart 303-231-3162
MMS: Securing Ocean Energy & Economic Value for
America
U.S. Department of the Interior
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